hey I've got two questions. What is the difference between a selling, marketing and customer approach. Also which ratio indicates how solvent a business is. Is it the gearing ratio?

Hey!

So there are three main historical approaches which businesses have adopted to sell their products

The production approach focuses on mass producing an item, emphasis on quantity and reducing costs. It was assumed the customer would buy the item and that there would be demand however there was little consideration for what the customer actually wanted.

The selling approach used aggressive sales techniques to convince their consumers to buy their products and that their products were better than their competitors. The needs of the customer was still not taken into consideration

The marketing approach (also known as the consumer approach) accounts for the needs of the customer and put them at the centre of business activities. It was the businesses purpose to satisfy the customer. Research was undertaken to identify customer needs and then cater to those needs. Satisfied customer = increased sales. (this approach is used by majority of businesses today)

And yes the gearing ratio refers to the businesses solvency. Solvency is defined as a businesses ability to meet their financial obligations in the long term. The gearing ratio measures debt to equity so it shows the businesses ability to pay their debts based off the equity they have invested (or reinvested through retained profits) into the business.

So there are three main historical approaches which businesses have adopted to sell their products

The production approach focuses on mass producing an item, emphasis on quantity and reducing costs. It was assumed the customer would buy the item and that there would be demand however there was little consideration for what the customer actually wanted.

The selling approach used aggressive sales techniques to convince their consumers to buy their products and that their products were better than their competitors. The needs of the customer was still not taken into consideration

The marketing approach (also known as the consumer approach) accounts for the needs of the customer and put them at the centre of business activities. It was the businesses purpose to satisfy the customer. Research was undertaken to identify customer needs and then cater to those needs. Satisfied customer = increased sales. (this approach is used by majority of businesses today)

And yes the gearing ratio refers to the businesses solvency. Solvency is defined as a businesses ability to meet their financial obligations in the long term. The gearing ratio measures debt to equity so it shows the businesses ability to pay their debts based off the equity they have invested (or reinvested through retained profits) into the business.

Hope this helps!

Yes helped so much! Thankyou. Would you be able to tell me the difference between domestic and global contractor? Thanks

Yes helped so much! Thankyou. Would you be able to tell me the difference between domestic and global contractor? Thanks

Hi Dani!

The answer to this question is quite simple. A domestic contractor outsources their non-core business functions to within their own country. For example, you are a small business operating out of Sydney but you contract your payroll system to Brisbane. For a real life perspective, Qantas (which was founded in Melbourne) actually domestically outsources its call centres and telecommunications to Melbourne. This is so they can focus on providing their core business function of ensuring on time arrivals and departures of flights, and allow specialists to undertake their non-core function of call centres.

On the other hand, global contracting is outsourcing to overseas. For example an Australian business outsourcing some of their labour to India. This is very common with businesses as they like to take advantage of the low costs and less stringent laws in developing countries such as India, Bangladesh, etc. Again, Qantas has also outsourced more of its non-core functions such as its maintenance functions to the Phillipines and Malaysia so they can effectively take advantage of the low labour costs overseas while still delivering a high quality service.

Thankyou very much @emilyygeorgexx. Another question (lol sorry for being so annoying). so i know the difference between LIFO and FIFO and how lifo undervalues inventory thus cogs are high and vice versa. Do I need to know exactly how to calculate the value of the inventory? And if so would you be able to explain it to me thankyou very much

Thankyou very much @emilyygeorgexx. Another question (lol sorry for being so annoying). so i know the difference between LIFO and FIFO and how lifo undervalues inventory thus cogs are high and vice versa. Do I need to know exactly how to calculate the value of the inventory? And if so would you be able to explain it to me thankyou very much

Hi Dani!

For the purposes of this course, you donít really need to know how to calculate LIFO and FIFO. I have only ever seen it in about 2 trial papers and both questions technically had no correct answer to choose. So I wouldnít stress about the calculation because if you canít do it, then the chance is that the rest of the state wonít be able to do it. As long as you know what LIFO and FIFO are and their effects on COGS and profit, you should be covered!

hey so for the life of me i dont get how to answer these types of questions (see attachment) someone pls help thanks x

Hey!

We start in January, in the blurb below the table they tell us the opening cash flow is $2000. So to find the closing cash balance for January you have to take the cash inflows (cash receipts + opening cash balance for that month) and minus the cash outflows (cash payments) which is $2000 + $12000 - $8000 = $6000.Therefore the closing cash balance for January will be $6000, this is also the opening cash balance for February. Now to find the closing cash balance for February we do the same thing. This will be $6000 + $11000 - $5000 =$12000So this means the closing cash balance for February was $12000 which is also the opening cash balance for March.

If you continue to do this with the remaining figures and i'm correct then the answer should end up being $7000 which is A

We start in January, in the blurb below the table they tell us the opening cash flow is $2000. So to find the closing cash balance for January you have to take the cash inflows (cash receipts + opening cash balance for that month) and minus the cash outflows (cash payments) which is $2000 + $12000 - $8000 = $6000.Therefore the closing cash balance for January will be $6000, this is also the opening cash balance for February. Now to find the closing cash balance for February we do the same thing. This will be $6000 + $11000 - $5000 =$12000So this means the closing cash balance for February was $12000 which is also the opening cash balance for March.

If you continue to do this with the remaining figures and i'm correct then the answer should end up being $7000 which is A

Hey! Can someone help with this multiple choice question?A manufacturing business has recently changed its marketing strategy to include e-marketing. What external influence may have led to this?A) increased staffing costsB) underperforming retail salesC) the recent employment of a computer expertD) the inability to differentiate its brand from competitorsThanks!

Hey! Can someone help with this multiple choice question?A manufacturing business has recently changed its marketing strategy to include e-marketing. What external influence may have led to this?A) increased staffing costsB) underperforming retail salesC) the recent employment of a computer expertD) the inability to differentiate its brand from competitorsThanks!

i believe the answer to be D simply because:A refers to staff (internal)B sales not doing too well in the firm's physical store (interbal)C computer epert employed by the company (internal)D competitor influence (external)

hey, me again! can someone pls help me with this question, i dont know what numbers go where? thanks so much and i promise this is the last question that i will ask regarding past papers! tysm xx

Hey again!

So in order to work this question out the first thing we need to do is work out the Cost Of Goods Sold (COGS) which is given by the formula:Opening stock + purchases - closing stock = COGSMost questions will give you COGS but you should also know how to work it out

So now we sub in what we know:36000 + 74500 - 6500 = 104000Therefore COGS = $104000

Now to find Gross Profit we useSales - COGS = Gross Profit

Sub in what we know:220000 - 104000 = 116000Therefore Gross Profit = $116000Making the answer to question 5 A

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